Nifty ended the week with a 1.6% gain, hitting record highs on three occasions, thanks to gains in IT and pharma stocks. When markets resume trading on Monday, a series of important domestic and global events scheduled for the week are likely to impact them.
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Nifty made a historic move last week, marking its 13th consecutive week of gains—a streak not seen in 31 years. The Nifty comfortably closed well above the 25,000 mark for the first time. Despite starting August under a cloud of uncertainty, the month ended on a high note,” Santosh Meena, Head of Research, Swastika Investment, said. He attributes the primary driver behind the bullish momentum to the growing anticipation of a rate cut in the US this month.
He also highlighted that foreign institutional investors (FIIs) have become net buyers of Indian equities over the past week, a trend supported by solid domestic liquidity.
Global Market’s
Global cues are expected to remain a dominant force, particularly those from the US. On Friday, Wall Street’s headline indices closed with solid gains, buoyed by supportive economic data reinforcing expectations for a September rate cut.
Rupee Vs Dollar
The Indian rupee ended little changed on Friday as dollar demand from state-run banks offset the potential impact of inflows into local equities. The rupee closed at 83.8625 against the US dollar, nearly flat compared to its previous close of 83.87. While most Asian currencies rallied between 2% and 6% in August, the rupee weakened by 0.2%, marking its second consecutive monthly decline.
The “bias is slightly on the positive side for the rupee.” Still, the currency is unlikely to rise above 83.70 in the near term, Dilip Parmar, a foreign exchange research analyst at HDFC Securities, said.
Ircon International,
Deepak Fertilizers, Sapphire Foods, and several other companies are likely to remain in focus next week as they approach their record dates for dividends, bonus issues, rights issues, and stock splits.
The company sets the record date to determine which shareholders can receive the offer. To qualify for a buyback offer, bonus issue, or stock split, the shares must be held in the Demat account as of the record date.
Technical Factors
Sectoral rotation is helping Nifty maintain elevated levels. Today, the IT and pharma indices drove the index to post healthy gains, said Jatin Gedia, Technical Research Analyst at Sharekhan.
“We expect Nifty to target levels of 25,500 on the upside. On the downside, the crucial support is at 25,000 to 24,900. We recommend continuing to ride the uptrend with a trailing stop-loss mechanism,” he advised.
FII/DII Action
On Friday, foreign institutional investors (FIIs) were net buyers with purchases amounting to Rs 5,318.14 crore. In comparison, domestic institutional investors (DIIs) were net buyers with purchases totaling Rs 3,198.07 crore.
IPO Action
Two companies are preparing to launch their IPOs: one in the mainboard segment and the other in the SME segment. Gala Precision Engineering will open its public subscription offer next week in the mainboard segment, while Jeyyam Global Foods will introduce its IPO for investors in the SME space.
The market will also see 11 listings, including those of Premier Energies and Ecos Mobility, which received a solid response for their IPOs in the past week.
Crude Oil
Oil prices remain critical for markets due to their impact on inflation and the monetary policies of global central banks, including India’s.
Global Macros
This week, the US will release data on ISM Non-Manufacturing New Orders (August), ISM Non-Manufacturing PMI (August), and ISM Non-Manufacturing Prices (August), along with initial jobless claims figures.
